Brazil becomes Uber’s latest regulatory battleground

Brazil becomes Uber’s latest regulatory battleground

A few weeks after being banned in London, the titan of ride-sharing services, is waging a new high-stakes regulatory fight in Brazil, the company’s second-largest market. Yesterday rival apps decided to combine forces to fight Uber together.

Brazilian lawmakers last week moved ahead on a bill that, as originally proposed, would have imposed licensing requirements that Uber said would cripple its model. But a last-minute lobbying blitz by the company, including a trip here by its new chief executive, Dara Khosrowshahi, appeared to have paid off.

The Senate tacked on amendments that significantly watered down the regulatory burdens. That kicked the legislation back to the House — and gave the company time to fight an effort by taxi unions to drive it and other app-based services out of the market.

In the coming weeks, Uber expects to lobby members of the House to sign off on the amendments, which the company’s spokesman, Fabio Sabba, called “effective regulation” and no longer a “veiled prohibition.” It is not clear how soon the House will take up the measure.

On the eve of Tuesday’s vote in the Senate, Uber drivers protested by blocking roads, paralyzing parts of Brasília, the capital, and São Paulo, Brazil’s financial hub. The company took out prime-time ads on Globo, Brazil’s main television station, and arranged meetings between Mr. Khosrowshahi and senior Brazilian officials, including Finance Minister Henrique Meirelles.

As Mr. Khosrowshahi pressed his case, he struck a more conciliatory tone than the company had pursued under its founder, Travis Kalanick, who was forced out in June by investors.

“In the past, we were a little aggressive,” Mr. Khosrowshahi said in an interview with Estado de S. Paulo. “But we have to understand that it isn’t just about what we want, and reach compromises that work for us and for the countries.”

Uber has elbowed its way into important markets in Latin America, including Colombia and Chile, where its model is unregulated. The company and a handful of rivals have developed a loyal following, but their growth has been met with crackdowns by the authorities and protests by taxi drivers. Chilean lawmakers are considering a regulatory bill.

Mr. Khosrowshahi signaled in the interview that Uber was open to some regulation in Brazil. But he said the original bill would have “drastically” reduced the number of Uber drivers in Brazil, currently 500,000. According to the company, Uber has more than 17 million users in Brazil.

Cabify, 99 and other ride-hailing services also staged strikes and placed ads in national media outlets. The demonstrations clearly gave senators pause as they voted on the measure, which the House had passed last month. The Senate amendments did away with requirements that drivers own their vehicles and obtain a special license plate that is notoriously hard to get in some cities.

Other provisions — including one allowing municipal inspection of vehicles — were left intact.

Uber’s more conciliatory approach in Brazil comes after a bruising loss in London, where officials declined to renew its license. The agency overseeing subways, buses and taxis declared that the company was not sufficiently “fit and proper.”

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  • Brazil becomes Uber’s latest regulatory battleground.

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